In Order for Advertising to Be Found Deceptive by the FTC,it

question 10

Multiple Choice

In order for advertising to be found deceptive by the FTC,it is necessary that:

• A) the advertisement can only be reasonably interpreted in one way,and in that way,it is misleading.
• B) there is a misrepresentation,omission,or practice that is likely to mislead the consumer acting reasonably in the circumstances,to the consumer's detriment.
• C) the sellers have malice or evil intent.
• D) something affirmative was said which was misleading;i.e. ,an omission cannot be deceptive.

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Definitions:

Break-Even Point

The level of sales at which total revenues equal total costs, resulting in zero profit.

Fixed Costs

Costs that do not vary with the level of output or sales, such as rent, salaries, and insurance premiums.

Variable Costs

Costs that change in proportion to the level of production or sales volume, such as raw materials and direct labor.

Dollar Contribution Margin

The difference between total sales revenue and total variable costs, expressed in absolute currency terms.